Measuring the Economy

1. 13.2 How do Economists Measure the economy

1.1. term 2) Gross domestic product- the market value of all final goods and services produced within a country during a period of time

1.2. term 2) Market Value- the amount buyers are willing to pay for a good or service.

1.3. Key point 1)Limiters of GDP indicate health

1.4. Key point 2) GDP makes people better off

1.5. Key point 3) Calculating GDP (C+I+

2. 13.3 What does the unemployment rate tell us about the economies health.

2.1. Unemployment rate - The percentage of unemployed workers seeking work

2.2. Seasonal Unemployment- Unemployment that results when business is slow usually do to weather.

2.3. Key point 1) There are 4 types of unemployment Seasonal, Frictional, structural and cyclical

2.4. Key point 2) High economic costs due to unemployment

2.5. Key point 3) Goverment measures unemployment by BHS

3. 13.4 What does inflation rate tell us about the economies health

3.1. Inflation rate - the percentage increase in the average price level of goods and services from one month or year to the next

3.2. Real wages: wage levels based on constant dollars; nominal wages adjusted for inflation

3.3. Key point 1) BLS tracks the countries cost for living

3.4. Key point 2) 3 types of inflation Creeping inflation, Hyperinflation, and deflation

3.5. Key point 3) CPI measures inflation

4. 13.5 How does the business cycle relate to economic health

4.1. Business cycle: a recurring pattern of growth and decline in economic activity over time

4.2. Recession: a period of declining national economic activity, usually measured as a decrease in GDP for at least two consecutive quarters

4.3. Key point 1) There are 4 phases of the business cycle

4.4. key point 2) Goes from boom to boom again

4.5. Key point 3) Business cycles are irregular in both length and severity.